Strategic Bank Management and ALM Development for Finance Professionals

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1 Strategic Bank Management and ALM Development for Finance Professionals A Blended-Learning Program from ACF Consultants

2 ACF Consultants have a solid reputation for delivering innovative, top-quality training for some of the largest and most demanding financial institutions in the world. ACF Consultants are global leaders in the creation of cutting-edge financial simulations and interactive elearning for the global financial markets. We are the first premier financial training company to offer open seminars using our uniquely blended learning techniques. Blended learning is a fundamental principle of the ACF approach to training. Our seminars offer a fully integrated, multi-faceted learning experience which ensures that knowledge is applied in practice and retained effectively. We limit the numbers attending each program to maximise the benefit for each delegate. Passive learning is kept to a minimum, and the emphasis is on delegates achieving a true understanding of the key concepts, and how they are applied in the real world. Blended learning is at the heart of our training philosophy. A dynamic blend of highly interactive elearning using Acumen, top quality instructor-led training, and realistic and exciting simulations creates the most effective and motivating training methodology available anywhere. Firm foundations are laid with highly interactive elearning and dynamic instructor-led training. Hands-on workshops and simulation are then used throughout the programs allowing delegates to put theory into immediate and realistic practice. Our instructor-led training is of the highest quality, and we invest heavily in research and development. Our professional written materials complement trainers with first-rate communications skills, an excellent academic background and sound markets knowledge. Our expert instructors are skilled in the art of transferring knowledge, and we make use of a variety of creative training techniques to maintain energy and focus. We are committed to achieving exceptional results. Development for Finance Professionals ACF Consultants Ltd

3 The aftershocks from the credit crisis, continued problems with impairments, slow economic growth, the pressure on bank capital and liquidity, and new rules and regulations, have all combined to make bank management significantly more difficult. Basel III the new system for determining the level of banks capital and liquidity creates a much more challenging environment for banks to operate within, and it is getting more difficult every year as the minimum requirements are raised step-by-step. ACF s Global Banker simulation features a full implementation of the new BIS liquidity and capital measures, allowing delegates to experience at first-hand how they work in a completely realistic environment. The results are surprising Basel III will potentially cut bank profitability by almost 40%. Never before has it been so important for bankers at all levels and in all roles to understand the complexities of banking in the 21st century, to be aware of how their role fits in, to comprehend the big picture, and to identify problems before they become serious. The Strategic Bank Management seminar does just that. Using realistic and detailed scenarios, the seminar shows delegates how to develop effective solutions to today s problems and strategies to ensure that their bank maintains profitability. In the Strategic Bank Management Seminar, over an intensive three-day period, delegates will: Obtain a detailed overview of total bank operations seeing clearly how everything fits together. Appreciate the impact of Basel III on commercial bank operations. Establish how to restore profitability through the design and execution of successful strategies taking into account the need for liquidity and the cost of capital in a Basel III world. Identify and analyse a bank s exposure to the various sources of risk and how to design strategies to control risk within acceptable bounds. Appreciate the dynamics of commercial banking exploring the interactions between funding, lending, liquidity, and capital. Assess how derivatives like interest rate swaps and credit default swaps can enable banks to manage their exposure to interest rate and credit risk but to be aware of counterparty and mark-to-market risk. Explore how successful securitisation can help banks manage their balance sheet. Understand asset and liability management concepts and how they affect day-to-day decisions throughout the bank. Broaden the breadth and depth of their banking knowledge learning about and gaining first-hand experience within each major area of the bank. How Basel III will impact banks Development for Finance Professionals ACF Consultants Ltd

4 After taking part and experiencing the issues at first hand with Global Banker, delegates will gain a remarkable understanding of each of the principal functional areas within a bank, and see clearly how these areas successfully integrate together. Delegates will learn to recognise the wider impact of their actions, and will be able to apply more astute judgement in the execution of their decisions. Instead of a blinkered outlook, delegates will have a panoramic view. Instead of copying the competition, delegates will devise creative strategies. Instead of reacting to problems, delegates will identify potential obstacles and implement pro-active tactics to circumvent them. In short, delegates will be able to make better, more profitable, but safe decisions, to the material advantage of the bank. In an ever more complex and risky world, the Strategic Bank Management Seminar will help delegates achieve the critical edge. Delegate Profile ACF s Strategic Bank Management seminar will be of tremendous benefit to any bank officer who needs to understand the big picture. At first sight, some may think this would only apply to top management, but such a belief would be mistaken. Anyone whose decisions affect the bank whether at branch, divisional, or head office level will certainly derive tangible benefit from the experience. For example, a corporate lender assessing loan profitability will learn not only to look at the straight margin over cost of funds, but to take into account the bank s cost of capital, liquidity servicing costs, income from related services, bad debts, and operational costs as well. Those for whom the seminar will be particularly relevant include: middle-management and senior bank executives country, regional, and senior branch managers high-flyers on accelerated development programmes credit and corporate finance officers domestic and international managers treasury staff strategists, planners, and those actually responsible for asset and liability management operational, support, and other head-office personnel regulators responsible for monitoring the operations of a large bank government personnel involved in overseeing financial institutions Development for Finance Professionals ACF Consultants Ltd

5 Overview of Bank Financial Management Balance sheet structures On- and off-balance sheet accounts Interest rate risk measures Securitisation Regulatory ratios Capital adequacy Liquidity ALM concepts Integrating total bank operations credit, finance, trading, treasury and risk management Hot Topic: The importance of credit risk, liquidity, and capital in today s environment. Risk Management Identifying banking risks Credit risk Exposure from traditional lending Exposure through credit derivatives like CDS and CDO Liquidity risk Analysing the need for liquidity Providing liquidity asset-based and liability-based alternatives Interest-rate risk Maturity mismatch Gap risk Yield-curve risk Currency risk Duration risk Operational risk Quantifying risk exposures Controlling risk through pro-active risk management Hedging techniques using derivatives Integrating and combining risks The Value-at-Risk (VaR) approach Topical issues: Measuring risk under crisis conditions Combining credit risk and market risk Hot Topic: Measuring risk in a stressed environment beyond the VaR approach. Profitability in a Basel III World Measuring profitability: RoA vs. RoE Risk-adjusted returns Capital-adjusted returns Risk-return trade-off Impact of capital and liquidity requirements on bank profitability Cost of implementing hedging programs Hot Topic: Returning to and maintaining profitability. Development for Finance Professionals ACF Consultants Ltd

6 Lending Policy and Credit Risk Credit risk and its impact Risk assessment Establishing acceptable levels of risk-adjusted return Using credit derivatives to manage credit risk exposure Achieving the right lending mix Retail vs. corporate Syndicated loans Floating-rate vs. fixed-rate Pricing Marketing Hot Topic: The importance of credit risk management in today s environment. Liquidity, Financing Policy, and Basel III Retail vs. money-market funding Over-dependence on the money-markets the problem Liquidity risk from market funding Competing for retail deposits Marketing Minimising costs of money market funding Timing Liquidity Basel III and the new liquidity ratios: Liquidity Coverage Ratio Net Stable Funding Ratio Hot Topic: How much will the new Basel III liquidity rules affect my bank? Treasury Management Using money-market instruments bills, CDs, commercial paper and bonds Using derivative instruments futures, options, FRAs and swaps Controlling risk Managing cash flows and liquidity Investment management Hot Topic: Investing in liquid assets when Treasury rates are zero. Capital Management Raising capital Debt vs. equity vs. hybrid instruments Floating-rate vs. fixed-rate debt Callable bonds Convertibles, equities Measuring the cost of capital RAROC Capital allocation Securitisation of assets Hot Topic: Raising capital what is the best choice? Development for Finance Professionals ACF Consultants Ltd

7 Capital for Credit, Market, and Operational Risk Basel I through Basel III Basel I Tier One, Tier Two, and RWA Basel II Pillars I, II, and III Menu of approaches Standardised vs. Internal Ratings Based (IRB) approaches Foundation vs. Advanced IRB approaches Using internal credit models Allowance for credit risk mitigation Use of credit derivatives Collateralisation Operational risk Basel III The new capital and leverage ratios The Capital Conservation Buffer The Countercyclical Buffer The Market Risk Amendment Using internal market risk models The multiplier: yellow and red cards Hot Topic: How will Basel III affect my bank? Development for Finance Professionals ACF Consultants Ltd

8 Strategic Bank Management and ALM Registration Form Fax to: +44 (20) or +1 (212) Contact Information: Tel: +44 (20) (212) Fax: +44 (20) (212) If you are interested in any financial training seminars, please visit our website(s) at: Accreditation: ACF Consultants Ltd is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State Boards of Accountancy have final authority on the acceptance of individual courses for CPE Credit. Complaints regarding registered sponsors may be addressed to the National Registry of CPE Sponsors, 150 Fourth Avenue North, Suite 700, Nashville, TN Website: Fees: The fee for each seminar is per participant, inclusive of refreshments, lunches and seminar materials. Course fees do not include applicable tax, transportation, or hotel accommodation, unless otherwise indicated. Preferential rates may be available; please mention our seminar when booking with the hotel. Payment must be received in full at least 30 days prior to the start of the seminar. Special prices (participants are only eligible for one of the following): 5% reduction when an individual registers 60 days or more prior to the commencement of a seminar 10% reduction when 2 or more individuals from an organization register for the same seminar 10% reduction when an individual registers for more than one seminar at a time I WISH TO ATTEND THE FOLLOWING PROGRAM London New York Chicago Toronto Dates: Course Schedule - Classes run from 9am - 5pm. Lunch, and morning and afternoon refreshments are provided daily. Venue details will be provided on receipt of registration form. HOW DID YOUR HEAR ABOUT THE PROGRAM? Colleague Client s Company Google ACF s Event ACF s Rep ACFacademy.com NASBA Advertising Financial Times DELEGATE DETAILS Name: Title: Department: Company: Address: City: State/County: Zip/Postcode: Country: Telephone: Fax: ADDITIONAL DELEGATE DETAILS Name: Title: Department: Company: Address: City: State/County: Zip/Postcode: Country: Cancellation Policy: Cancellations may be made up to 30 days in advance of the seminar, after which date refunds cannot be given. Notification must be received in writing by letter, fax, or . In the event of a participant not being able to attend, a substitution may be made at no extra cost. We reserve the right to amend the prices, or cancel a seminar at any time. PAYMENT DETAILS Payment Method: VISA Master Card Invoice me at the address listed above Card #: Cardholder Name: Expiration: CVC: Refund Policy: For further information on our refund and complaint policy, please contact us. Signature: (signature required)